Romania's Premier: Foreign Investment Up

Romania's Premier Says Foreign Investment Up 15 Percent in First Half of 2005

BUCHAREST, Romania (AP) -- Romania's direct foreign investment has increased by 15 percent in the first half of this year to euro1.48 billion (US$1.85 billion), Prime Minister Calin Popescu Tariceanu said Tuesday.

Tariceanu, who was launching Romania's new export strategy, urged authorities to do more to assist investors and local businesses to help the country be more competitive on foreign markets.

The premier praised the progress made by French car maker in Romania with the launching of its popular new model, the Logan.

"I'd like to see more investors like Renault in Romania, serious and ambitious investors who respect their commitments," he said, adding that Renault was now building a new euro215 (US$269) factory in Pitesti.

Outlining the new strategy for exports, Tariceanu said that Romanian companies should try to reorient their exports in the European Union toward more sophisticated products. He also urged Romanian businessmen to expand their operations in the southeast European region and former Soviet states.

He warned that tax evasion remained at high levels in Romania, distorting the business environment and urged authorities to improve tax collection, especially of the value-added tax.

"Unless Romania solves this fundamental problem, the economy will not grow strongly, we won't have real competition and we won't have an attractive business climate."

Also Tuesday, President Traian Basescu urged the government to raise taxes on alcohol and cigarettes, with the extra money going to help the country's struggling health system.

"The suppliers of disease should pay more for the health system," he said. Basescu, an avid smoker, said he would consider giving up the habit if the tobacco taxes are raised.

source